Magazine article American Banker

Arizonans Offer Anatomy of an Interstate Banking Bill: Trade Group Official, State Senator Recount Experience for Benefit of New Mexico Commission: 'Everyone Swallowed Hard.'

Magazine article American Banker

Arizonans Offer Anatomy of an Interstate Banking Bill: Trade Group Official, State Senator Recount Experience for Benefit of New Mexico Commission: 'Everyone Swallowed Hard.'

Article excerpt

ALBUQUERQUE -- The decision by Arizona bankers to support interstate banking was an 11th-hour compromise, according to the executive vice president of the Arizona Bankers Association and an Arizona state senator.

"We came to one determination: The issue would not divide and consume us to the point we were not effective on other issues," said D. Gordon Murphy, of the Arizona association, who subsequently lobbied the bill successfully through the Arizona Legislature.

The state's lawmakers, according to state Sen. Jacque Steiner, realized "market forces were changing financial institutions, and we better be ready to deal with that." She said the nonbank bank issue was also "nipping at our heels."

The two Arizonas recently made those remarks to members of New Mexico's Interstate Banking Commission, the group appointed by Gov. Toney Anaya to make a recommendation by Dec. 1.

Interstate banking surfaced in Arizona in 1983, as it did in New Mexico, when Citicorp wanted permission to enter. Legislatures in both states defeated the bills, but Arizona bankers asked for a commission to study the issue.

"We bought a year," Mr. Murphy said. "But we incurred a responsibility to act. Fortunately, the commission forced us to come to an agreement as an industry."

The commission began meeting in January 1984. By April, it had unanimously agreed to allow within four years regional banking that would exclude California. By fall, however, "the ground really shifted," Mr. Murphy said. "We backed off [the California exclusion] with egg on our face," he said. …

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